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Las Vegas Sands Corp. Message Board

  • bjspokanimal bjspokanimal Aug 13, 2013 2:01 PM Flag

    Among Analysts, the Least Amount of Pessimism is with LVS

    A quick check of the "analytst's opinion" tabulations shows Wynn with 7 hold recommendations and zero sells. Star performer Melco has 4 holds and 1 sell.

    LVS has 2 holds and no sell recommendations.

    IMO, the reason why LVS has so few hold and sell recommendations is the company's relative absence of "downside potential".

    The reason for THAT is many reasons, IMO. First, it's hard to be pessimistic with the growth and growth potential of LVS's new resorts that are ramping in a growth industry/geography. Secondly, the dividend and strong financials form a base of core support among income-seeking, long-term investors who like LVS now (and didn't like LVS in 2009) for it's relative safety and income. Melco, on the other hand, is years away from a new resort and carries a much higher P/E ratio than LVS.

    There's also the $2 billion stock buyback program, meaning that the company itself will be buying on the dips.

    Finally, there's the fact that there's reasonably good "value" in the fact that company EBITDA and revenue has steadily advanced since late 2010, but the stock price has not. Analysts appear to be figuring that you can only swim against the current for so long.

    Also inherent in "value" is that the book value per share of LVS's assets is far below the actual liquidating value of it's assts. Ask any fan of a REIT spin-off how he feels about THAT one.

    Spok

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    • I just don't get relative valuations of LVS, WYNN and MPEL. MPEL pays no dividend, WYNN has no Singapore and is less well positioned in the Macau mass market and yet they trade at healthy P/E premiums to LVS. Is it really Suen, Jacobs and FCPA? Suen is a non-event and the other two, while troublesome, will not likely lead to any change in future business prospects.

    • I'm going to add that my view of LVS as a "value" proposition is fragile.

      This comment may not sit well with some LVS bulls out there, but I'm a value investor and LVS's value exists in my view of the company as having a "forward PEG ratio" that is under 1.0 when you consider "normalized earnings growth" over the next 18 months.

      A surge in the stock price that is not accompanied by a "somewhat" corresponding rise in earnings growth expectations would compel me to begin reducing my holdings.

      My point? Only that LVS is not the contrarian play that it was in "09 and the first 8 months of 2010. It's good value is reflected in contrarian thinking only to the degree to which retail investors are waiting for an EPS turn-around that is already reflected in some of the company's other financial metrics...

      ... and a couple of lucky quarters could create euphoria in the stock price that coud turn LVS into a nose-bleed, momentum play that I would rather not own, should that occur in the months to come.

      Just a step-back, reality check here. There is never a good time to ignore good discipline due to a high degree of familiarity.

      Till tomorrow...

      Spok

      • 1 Reply to bjspokanimal
      • Spok, Smart money left in 11/2010. we have been holding for nothing it appears. Next decent run will force me to turn to cash and just day trade lvs. I really though we could get much higher the last few years. Now with the stock buybacks the pps will get hit often like the last week in June. Hoping for one more big push up on some good news, hopefully before it gets hit downwards again. lol

        Sentiment: Hold

 
LVS
74.60-0.33(-0.44%)Jul 11 4:00 PMEDT

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